Answers
The cost reconciliation indicates a discrepancy, as the total costs assigned exceed the beginning work in process costs. This could be due to additional costs.
How did we arrive at this assertion?To prepare a production cost report for the Welding Department for the month of February, we need to calculate the following:
1. Equivalent units of production for materials, labor, and overhead.
2. Cost per equivalent unit for materials, labor, and overhead.
3. Total costs assigned to units transferred out and ending work in process.
4. Cost reconciliation.
Let's calculate each of these steps:
Step 1: Equivalent Units of Production
Equivalent units of production are calculated based on the percentage of completion for units in process.
For materials:
Beginning work in process: 15,000 units x 10% complete = 1,500 equivalent units
Units transferred in: 64,000 units
Ending work in process: 25,000 units x 20% complete = 5,000 equivalent units
Total equivalent units for materials: 1,500 + 64,000 + 5,000 = 70,500 equivalent units
For labor and overhead:
Since the given data does not provide the percentage of completion for labor and overhead, we assume it is the same as for materials. Therefore, the equivalent units for labor and overhead will also be 70,500 units.
Step 2: Cost per Equivalent Unit
To calculate the cost per equivalent unit, we divide the total costs by the total equivalent units.
Cost per equivalent unit for materials: $135,000 / 70,500 units = $1.91 per unit
Cost per equivalent unit for labor: $57,000 / 70,500 units = $0.81 per unit
Cost per equivalent unit for overhead: $35,100 / 70,500 units = $0.50 per unit
Step 3: Total Costs Assigned
To calculate the total costs assigned to units transferred out and ending work in process, we multiply the cost per equivalent unit by the equivalent units for each category.
For units transferred out:
Materials: 64,000 units x $1.91 per unit = $122,240
Labor: 64,000 units x $0.81 per unit = $51,840
Overhead: 64,000 units x $0.50 per unit = $32,000
For ending work in process:
Materials: 25,000 units x $1.91 per unit = $47,750
Labor: 25,000 units x $0.81 per unit = $20,250
Overhead: 25,000 units x $0.50 per unit = $12,500
Step 4: Cost Reconciliation
To reconcile the costs, we compare the total costs assigned to units transferred out and ending work in process with the beginning work in process costs.
Beginning work in process costs: $32,175
Total costs assigned to units transferred out: $122,240 + $51,840 + $32,000 = $206,080
Total costs assigned to ending work in process: $47,750 + $20,250 + $12,500 = $80,500
Total costs: $206,080 + $80,500 = $286,580
Since the total costs assigned exceed the beginning work in process costs, there may be some additional costs that need to be investigated or accounted for.
The production cost report for the Welding Department for the month of February is as follows:
------------------------------------------------------------------------
| | Equivalent Units | Cost per Equivalent Unit | Total Costs |
------------------------------------------------------------------------
| Materials | 70,500 | $1.91 | $135,000 |
| Labor | 70,500 | $0.81 | $57,000 |
| Overhead | 70,500 | $0.50 | $35, 100 |
------------------------------------------------------------------------
| Total (Transferred-out) | 64,000 | | $227,240 |
| Ending work in process | 25,000 | | $80,500 |
------------------------------------------------------------------------
| Total Costs $307,740 |
------------------------------------------------------------------------
Note that the cost reconciliation indicates a discrepancy, as the total costs assigned exceed the beginning work in process costs. This could be due to additional costs.
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Related Questions
Based on the economic theory and the article, provide an alternative item(s) to tax that would be more efficient. Explain why taxing that item would be more efficient.
Answers
One alternative item to tax that would be more efficient based on economic theory and the article are Pigouvian taxes, which are taxes on goods that have a negative externality. This tax would be more efficient because it would reduce the negative externality of pollution and provide an incentive for people to use less gasoline.
A negative externality is a cost imposed on society that is not factored into the market price. For example, pollution from cars imposes costs on society in the form of health problems and environmental damage. A Pigouvian tax on gasoline would increase the price of gasoline to account for these costs and encourage people to drive less or use more fuel-efficient cars.
In contrast, a tax on soda would not address a negative externality and would likely be regressive, meaning it would disproportionately affect low-income individuals who spend a higher percentage of their income on soda. Additionally, the article mentioned that there are already many taxes on soda, and further taxing it may not significantly reduce consumption.
In contrast, a Pigouvian tax on gasoline would be a new tax that would effectively address a negative externality. Overall, Pigouvian taxes are a more efficient way to tax because they internalize the costs of negative externalities and encourage individuals to make more socially optimal choices.
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Type the correct answer in the box. Spell all words correctly.
Andy is preparing the company's income statement. His first line item is the company's service revenue. What will he deduct from this line item to obtain the net income?
Andy needs to subtract
from the service revenue.
Answers
Andy needs to subtract cost from the service revenue. Revenue is the total income earned before any deductions are made. Net income is the total revenue less total expenses or cost.
Cost of goods sold (COGS), operational expenses, interest expenses, and taxes are all examples of these expenses.
COGS: This refers to the direct costs incurred in providing the services, such as the cost of materials, labour, and other expenses directly associated to delivering the service.Operating expenses are the indirect costs of running a business and include rent, utilities, salaries and wages of personnel who are not directly involved in providing the service, marketing charges, and administrative costs.Interest expenditures: If the company has borrowed money to fund its operations, interest expenditures must be deducted.For such more question on Revenue:
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The following question may be like this:
Andy is preparing the company's income statement. His first line item is the company's service revenue. What will he deduct from this line item to obtain the net income?
Andy needs to subtract _______ from the service revenue.
diversity issues(only five diversity issues)
Answers
Racial and Ethnic Diversity: One of the most prevalent diversity issues is the underrepresentation and marginalization of certain racial and ethnic groups. Discrimination, prejudice, and systemic barriers can hinder equal opportunities and inclusion for individuals from diverse racial and ethnic backgrounds.
Gender Inequality: Gender diversity issues involve disparities between genders, such as unequal access to education, employment opportunities, and leadership positions. Gender stereotypes, biases, and discriminatory practices contribute to gender inequality and hinder progress toward gender equity.
LGBTQ+ Rights: LGBTQ+ diversity issues encompass discrimination, exclusion, and lack of legal protections faced by lesbian, gay, bisexual, transgender, and queer individuals. Issues include limited legal recognition, employment discrimination, and social stigma, which can negatively impact the well-being and rights of LGBTQ+ individuals.
Disability Inclusion: Disability diversity issues involve the exclusion and discrimination faced by people with disabilities. Challenges include inaccessible physical environments, limited employment opportunities, and social prejudice. Ensuring equal access, reasonable accommodations, and inclusive practices are crucial for disability inclusion.
Socioeconomic Inequality: Socioeconomic diversity issues encompass disparities based on income, wealth, and social class. Individuals from lower socioeconomic backgrounds often face limited access to quality education, healthcare, and employment opportunities, which can perpetuate cycles of poverty and inequality.
Your reading material states that it is important to give workers tasks that are
"commensurate with performance __________."
a. standards
b. objectives
c. benefits
d. bonuses
Answers
Your reading material states that it is important to give workers tasks that are "commensurate with performance Option (a) standards.
Commensurate with performance standards means that tasks that are assigned to workers should be based on their performance standards. It is important for a manager to know the performance standards of an employee before assigning him/her any task. This helps to motivate workers and improve their productivity. A manager should know the strengths and weaknesses of his workers to give them tasks that are commensurate with their performance standards.
If a manager assigns a task that is too hard or too easy, it can lead to frustration or boredom in the worker. In the same way, if a task is too easy, then it can lead to a lack of motivation for the worker. Therefore, tasks assigned should be challenging but doable based on the performance standards of the worker. Performance standards are set to determine the quality, quantity, and time required for a specific task. Performance standards help in measuring the progress of a worker and the organization as a whole.
Performance standards can help in identifying the areas of improvement and training that a worker might need to perform better in his tasks. In addition, performance standards help in creating a transparent work culture where workers know what is expected of them from their managers. Overall, performance standards are essential for creating a productive and efficient workforce. Therefore, the correct option is A.
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Suppose you have the opportunity to invest in a project that provides you with $4,000 every year forever. If you require an 8% return on investments with similar risk, what is the most you would be willing to pay for this project?
Answers
To determine the maximum amount you would be willing to pay for the project, we can use the concept of the present value of perpetuity. The present value is the current worth of future cash flows discounted at a specified rate of return. In this case, the perpetuity provides a constant cash flow of $4,000 every year indefinitely.
The formula for the present value of perpetuity is:
Present Value = Cash Flow / Discount Rate
Given that the cash flow is $4,000 and the required return or discount rate is 8% (0.08 as a decimal), we can calculate the present value as follows:
Present Value = $4,000 / 0.08 = $50,000
Therefore, the most you would be willing to pay for this project is $50,000. This amount ensures that the annual cash flow of $4,000 is equivalent to an 8% return on your investment, considering the risk and time value of money.
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221 HW4 Ch 21
Question 6 of 10
- / 1
Prepare a cost reconciliation schedule. (Round unit costs to 2 decimal places, e.g. 2.25 and final answers to 0 decimal places, e.g. 125.)
Cost Reconciliation
Cost accounted for
Transferred out
$
Work in process
Materials
$
Conversion costs
Total cost accounted for
$
eTextbook and Media
Answers
The cost reconciliation schedule:
Cost accounted for Transferred out $54,000Work in process Materials $36,000Conversion costs $25,500Total cost accounted for $115,500eTextbook and Media $0Transferred out: The transferred out cost is the sum of the materials, labor, and overhead. In this case, it is $36,000 (materials) + $88,500 (labor) + $54,000 (overhead) = $178,500.
Work in process - Materials: The work in process cost for materials is $36,000.
Conversion costs - Work in process: The work in process cost for conversion costs is calculated by multiplying the percentage of completion for conversion costs (50%) by the equivalent units of production for conversion costs (57,000). Therefore, it is 0.5 * 57,000 = $28,500.
Total cost accounted for: The total cost accounted for is the sum of the transferred out cost, work in process cost for materials, and work in process cost for conversion costs. In this case, it is $54,000 + $36,000 + $25,500 = $115,500.
eTextbook and Media: The cost of eTextbook and Media is not specified in the provided information. If there is no cost associated with eTextbook and Media, it would be $0.
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1. If 26,000 units are produced and sold, what is the variable cost per unit produced and sold?
2. If 35,500 units are produced and sold, what is the variable cost per unit produced and sold?
3. If 26,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold?
4. If 35,500 units are produced and sold, what is the total amount of variable cost related to the units produced and sold?
5. If 26,000 units are produced, what is the average fixed manufacturing cost per unit produced?
6. If 35,500 units are produced, what is the average fixed manufacturing cost per unit produced?
7. If 26,000 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production?
8. If 35,500 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production?
Answers
1. The variable cost per unit produced is $22.00.
2. The variable cost per unit produced is $22.00.
3. The total variable costs for units produced is $572,000.
4. The total variable costs for units produced is $781,000
5. The average fixed manufacturing cost per unit is $7.81.
6. The average fixed manufacturing cost per unit is $5.72.
7. The total fixed manufacturing cost is $202,950.
8. The total fixed manufacturing cost is $202,950.
Data and Calculations:
Relevant production range = 26,000 to 35,500 units
Average production and sales units = 30,750 units
Average Variable Costs:
Direct materials $ 8.60
Direct labor $5.60
Variable manufacturing overhead $ 3.10 $17.30
Sales commissions $ 2.60
Variable administrative expense $ 2.10 $4.70
Total variable costs $22.00 $22.00
Fixed Costs:
Per Unit Total
Fixed manufacturing overhead $ 6.60 $202,950 ($6.60 x 30,750)
Fixed selling expense $ 5.10 $156,825 ($5.10 x 30,750)
Fixed administrative expense $ 4.10 $126,075 ($4.10 x 30,750)
Total fixed costs for 30,750 units $485,850
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The following question may be like this:
Kubin Company’s relevant range of production is 26,000 to 35,500 units. When it produces and sells 30,750 units, its average costs per unit are as follows:
Average Cost per Unit
Direct materials $ 8.60
Direct labor $ 5.60
Variable manufacturing overhead $ 3.10
Fixed manufacturing overhead $ 6.60
Fixed selling expense $ 5.10
Fixed administrative expense $ 4.10
Sales commissions $ 2.60
Variable administrative expense $ 2.10
Required:
1. If 26,000 units are produced and sold, what is the variable cost per unit produced and sold?
2. If 35,500 units are produced and sold, what is the variable cost per unit produced and sold?
3. If 26,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold?
4. If 35,500 units are produced and sold, what is the total amount of variable cost related to the units produced and sold?
5. If 26,000 units are produced, what is the average fixed manufacturing cost per unit produced?
6. If 35,500 units are produced, what is the average fixed manufacturing cost per unit produced?
7. If 26,000 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production?
8. If 35,500 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production?
If interest is 5% compounded annually, calculate the future value of five year cash flows of $1,000 in year 1; $2,000 in year 2; $3,000 in year 3; $4,000 in year 4 and $5,000 in year 5.
Multiple Choice
$16,238.26
$16,638.26
$16,438.26
$16,838.26
$16,038.26
Answers
Option A. $16,238.26 is the closest approximation of the calculated future value.
To calculate the future value of the cash flows, we need to apply the compound interest formula:
Future Value = Present Value * [tex](1 + Interest Rate)^{Number of Periods}[/tex]
In this case, we have five cash flows over five years, and the interest rate is 5% compounded annually. Let's calculate the future value step by step:
Year 1: Future Value = $1,000 * [tex](1 + 0.05)^{1}[/tex] = $1,050
Year 2: Future Value = $2,000 * [tex](1 + 0.05)^{2}[/tex] = $2,205
Year 3: Future Value = $3,000 * [tex](1 + 0.05)^{3}[/tex] = $3,152.25
Year 4: Future Value = $4,000 * [tex](1 + 0.05)^{4}[/tex] = $4,310.06
Year 5: Future Value = $5,000 * [tex](1 + 0.05)^{5}[/tex] = $5,525.63
Now, we sum up all the future values:
Total Future Value = $1,050 + $2,205 + $3,152.25 + $4,310.06 + $5,525.63
Total Future Value = $16,243.94
Therefore, the closest option is A. $16,238.26.
It's important to note that the answer might differ slightly depending on the rounding method used at each step of the calculations. However, based on the given options, A. $16,238.26 is the closest approximation of the calculated future value. Therefore, the correct option is A.
The question was incomplete, Find the full content below:
If interest is 5% compounded annually, calculate the future value of five-year cash flows of $1,000 in year 1; $2,000 in year 2; $3,000 in year 3; $4,000 in year 4, and $5,000 in year 5.
Multiple Choice
A. $16,238.26
B. $16,638.26
C. $16,438.26
D. $16,838.26
E. $16,038.26
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